Number: RL32457
Title: Manufacturing and Information Technology Trends in the United States and Other Industrial Countries: A Review of Major Studies
Authors: Stephen Cooney, Resources, Science, and Industry Division 
Abstract: The decline in U.S. manufacturing employment and perceptions of an erosion in the U.S. industrial base have been a concern for U.S. policymakers. After the onset of a recession at the end of 2000, the United States lost nearly 3 million manufacturing jobs over three years, notwithstanding an economic recovery that began in late 2001. Only in early 2004 did manufacturing employment start to recover, adding a total of about 100,000 new jobs on a seasonally adjusted basis from February through May, according to the Department of Labors Bureau of Labor Statistics. There is widespread concern that the decline in manufacturing employment is mostly permanent, and not just a cyclical decline. Detailed CRS analysis found, however, that accelerated improvement in U.S. labor productivity accounted for a reduction across many industries in hourly labor input required to produce increased manufactured output. That analysis also looked at other countries, finding that the recent U.S. experience is not unique: manufacturing employment is declining almost everywhere as productivity improves. Recently, the Commission of the European Union2 (EU) and the Organization for Economic Cooperation and Development (OECD) published reports including analyses of comparative performance of the U.S. and other economies, especially with reference to the impact of information and communication technologies (ICT) on manufacturing and overall growth. The EU report included a direct comparison of U.S. and European industry. The OECD report studied investment and diffusion of ICT on a comparative basis in industrial economies in Europe, North America and Asia. The two reports are similar, in that they credit the United States, in comparison with other industrial countries, as having more success in utilizing information and communications technologies (ICT) to enhance the transition of its economy, including manufacturing, in the face of rapid global change.
Pages: 11
Date: July 7, 2004